TIDMTRAK
RNS Number : 7924W
Trakm8 Holdings PLC
28 April 2021
28 April 2021
Trakm8 Holdings plc
("Trakm8", the "Group" or the "Company")
Year End Trading Update
Trading Update
Trakm8 Holdings plc (AIM: TRAK), the global telematics and data
insight provider today announces a trading update for its financial
year ended 31 March 2021.
Revenues for the full year ending 31 March 2021 of GBP16.0
million are in line with previous guidance and 18% less than last
year. As expected, Covid-19 materially impacted the Company in the
last three months of the year, with significantly reduced hardware
shipments to our Insurance customers and with a less significant,
but meaningful, impact on Fleet customers.
Due to the strong cost reduction actions the Group expects to
achieve an adjusted loss for the financial year in line with
previous guidance of circa GBP0.3m. (FY-2020: Adjusted loss of
GBP0.2m).
Cash generation from operations has been strong and at 31 March
2021 the Group's net debt was GBP4.9m (GBP6.8m after IFRS 16
changes) which is GBP0.8m lower than at 31 March 2020 and a GBP0.7m
reduction since Sept 2020. At the year end the Group had GBP2.4m of
cash on hand and a further GBP0.5m of available funds under an
overdraft facility.
During the year connections increased by 4% to 254,000 (FY-2020:
245,000). Fleet connections reduced by 10% to 70,000 (FY-2020:
77,000), Insurance & Automotive connections increased by 9% to
184,000 (FY-2020: 168,000). Despite the increase in Insurance &
Automotive connections, revenues were lower in the financial year
from Insurance & Automotive as a result of the strategy to
broaden the footprint outside young driver telematics which has
resulted in new commercial offerings with lower revenue per unit,
but still maintaining gross margins. Recurring Revenues in the year
amounted to GBP9.4m representing 59% of Group revenues, 4% lower
than the prior year due to the reduction in the higher value Fleet
connections.
We were pleased to advise during the year that major contract
awards were received from The Parts Alliance Group and from a major
UK Retailer. As predicted, further insurance client wins were also
secured.
Further new products and solutions were introduced to the market
that will continue to improve the costs and functionality of the
solutions we sell.
Covid-19 Update
The Company believes Covid-19 lockdowns have reduced revenues in
the financial year by almost GBP4m and as a result, profitability.
However, the Company has benefitted from GBP0.9m from the Job
Retention scheme support and from GBP1.8m VAT, PAYE & NI
payment deferments. The Company has reached agreement with HMRC on
a time to pay agreement to spread this liability almost equally
over the next two financial years. The Company has encountered many
component shortages but through the vertical integration of design
and manufacturing hardware has managed to avoid this having an
adverse impact on revenues.
Bank Facilities Update
Trakm8 is pleased to announce a renewal of our facilities with
HSBC. The new agreements comprise a Term Loan of GBP5.3m and a
GBP0.5m overdraft facility. Capital repayments commence in
September 2021, with appropriate 'carve out' in covenants to cover
Covid-19. These facilities are in place until October 2023. In
addition, the capital repayment holiday of our loan with Maven
(GBP1.4m outstanding) has been extended, such that repayments will
now re-commence in September 2021. Interest on the loans continues
to be paid monthly.
Outlook
Covid-19 has continued to have an impact during April and there
remains some ongoing uncertainty for the coming months. The
resumption of driving tests occurred only on 22(nd) April and so it
is too early to know when there will be an increased take up of
telematics insurance policies. Demand in the fleet sector is
already improving.
Subject to there not being any further Covid-19 related
lockdowns or significant component supply issues that cannot be
resolved quickly, the Company is confident that the financial
performance will significantly improve for the new financial year
and expect revenues will revert to pre-Covid levels, which with
recently lower costs should lead to a profitable business for the
year.
- Ends -
For further information:
Trakm8 Holdings plc
John Watkins, Executive Chairman Tel: +44 (0) 167 543 4200
Jon Furber, Finance Director www.trakm8.com
Arden Partners plc (Nominated Adviser Tel: +44 (0) 20 7614 5900
& Broker)
Paul Shackleton, Head of Corporate www.arden-partners.com
Finance
Simon Johnson, Head of Sales
About Trakm8
Trakm8 is a UK based technology leader in fleet management,
insurance telematics, connected car, and optimisation. Through IP
owned technology, the Group analyses data collected by its
installed base of telematics units to fine tune the algorithms that
are used to produce its' solutions; these monitor driver behaviour,
identify crash events and monitor vehicle health to provide
actionable insights to continuously improve the security and
operational efficiency of both company fleets and private
drivers.
The Group's product portfolio includes the latest data analytics
and reporting portal (Trakm8 Insight), integrated
telematics/cameras/optimisation, self-installed telematics units
and one of the widest ranges of installed telematics devices.
Trakm8 has over 254,000 connections.
Headquartered in Coleshill near Birmingham alongside its
manufacturing facility, the Group supplies to the Fleet,
Optimisation, Insurance and Automotive sectors to many well-known
customers in the UK and internationally including the AA, Saint
Gobain, EON, Iceland Foods, The Parts Alliance Group, Direct Line
Group, LexisNexis and Ingenie.
Trakm8 has been listed on the AIM market of the London Stock
Exchange since 2005.
www.trakm8.com / @Trakm8
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